Global CIO Michael Strobaek: Hedging the cycle
Despite continuing trade tensions and the crisis in Turkey, the recent weeks of summer brought some calm for financial markets. We expect growth to remain robust and confirm our pro-growth positioning.
The global economy continues to reaccelerate and growth momentum is steady, something we expect to persist until year-end. We therefore reiterate our growth-oriented strategy, including our positive stance on equities and commodities. Both asset classes should benefit from the constructive macro environment. Within equities, we maintain our regional preference for Switzerland and emerging markets. In fixed income, we stay short duration in the core markets and continue to prefer selected emerging markets. Government bond yields are likely to rise further given the steady growth and some signs of higher inflation.
Late-cycle hedging strategies
In addition to careful diversification, we now also advocate so-called "Hedging the cycle" strategies. These strategies are particularly suited for the current late phase of the economic cycle. They should do well in case our growth scenario does not materialize but should not lose substantially in case growth remains robust, as we expect.
Opportunities in the Silver Economy
In terms of long-term opportunities, our Silver Economy Supertrend provides an attractive proposition. At its core is the expectation that the number of senior citizens is likely to double by 2050, a development that creates opportunities for companies in a number of industries such as healthcare and leisure.